Morgan Stanley: Apple ‘turning the corner in China’ and set up for an iPhone boost

“Apple Inc. reported growth in China in its latest quarter for the first time in nearly two years, and one analyst said Thursday that it is the start of a new pattern,” Emily Bary reports for MarketWatch. “‘We believe that Apple is just turning the corner in China and growth will meaningfully accelerate in the quarters to come,’ Morgan Stanley analyst Katy Huberty wrote in a note to clients Thursday.”

“Huberty thinks a number of factors are working in Apple’s favor in China, including increased interest in large-screen phones, a sizable base of older iPhones due for upgrades, and ‘pent up demand for a revolutionary new iPhone,'” Bary reports. “Data from Jiguang, a mobile-messaging company, suggests that there were more people who abandoned their Chinese smartphones for iPhones in the four-week period that ended Oct. 22 than there were iPhone users who moved over to a local manufacturer, according to Morgan Stanley.”

Bary reports, ‘We expect this trend to only accelerate as future data sets will include the period after the iPhone X first began shipping,’ Huberty wrote.”

Read more in the full article here.

MacDailyNews Take: All systems go for iPhone X!


  1. I swear there are so many analysts who are claiming how no one in China is going to be buying iPhones because of how much better Huawei, Oppo, Vivo, Xiaomi, et. al, smartphones are when compared to iPhones.

    I must admit even I had my doubts as the Chinese seem to be in love with that darn WeChat app which can work with any crappy smartphone. Tencent is growing in value like a freaking bamboo plant.

    I’ll be happy if even those Chinese consumers who own iPhones are upgrading. I can’t count on any Android smartphone users to switch. There’s just so darn much Android smartphone competition in China and they can easily undercut the iPhone in pricing just to get rid of inventory. I don’t know what Apple can do if Chinese smartphone companies are going to practically give their smartphones away to stop consumers from buying iPhones. There doesn’t seem to be any simple solution for something like that.

    There still too much doom and gloom for Apple and I wish Apple could do something about it. Hopefully, that repatriated overseas cash might be a cure for Apple’s “woes,” but there are analysts who say it won’t be. Whatever.

  2. Lot’s of Chinese own BMW, Ferrari and other luxury products, Asians are known for envying western iconic brands, luxury travel and world class media even though they don’t own real estate. Apple is not in this for maximum market share, but for middle class buyers and maximum profit margin, Apple will do well in the long run.

    1. It’s much the same in India, which has a population almost as big as China, but growing faster. There is a very upwardly mobile middle class in both countries and they aspire to display their wealth and success by being seen using premium western brands. A locally made Android phone certainly works satisfactorily for WeChat, but it will never have the cachet associated with an iPhone.

      Prestige counts for a lot in those societies. Apple only needs to sell to a small proportion of those huge populations in order to create a massive market.

      As one who has spent lot of time in both China and India, the levels of poverty are all too visible, but equally you can’t help but notice the numbers of their populations with expensive tastes.

      Closer to home, if you live or visit anywhere where international tourists like to go, you must have noticed how many Chinese tourists are everywhere these days. That is something which has only happened comparatively recently and it’s important to remember that travel is not cheap for Chinese people.

      I was surprised to be in rural Germany recently and see signs in shop windows written in Chinese trying to entice Chinese visitors to buy their goods. They used to have signs like that in English for the Brits and Americans, but presumably they reckon that the Chinese are now a more lucrative market.

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